Both Ecclestone and the teams have made it clear in the past that F1 must remain on Free to air TV and yet the Sky part of the deal, where they will broadcast all 20 F1 races and practice sessions live, would seem to contradict that.

Ecclestone's Mercedes arrives in Hungariring paddock for crunch meeting with teams

My understanding of the crucial clause in the Concorde Agreement is that it says that the Commercial Rights Holder must “avoid” a situation where F1 coverage is “only available on pay TV” in key markets, such as the UK.

Ecclestone may argue that this clause has been respected because all the races will be shown on the BBC, it’s just that half of them will not be live but will be highlights. Either way he is likely to have found a wording which allows this to happen.

BBC staff at the Hungaroring are stunned by today’s news and have not yet been informed of the details of how this arrangement will work.

Whitmarsh confirmed that the teams were not consulted on the deal despite the fact that it appears to go against the Concorde Agreement and makes a mockery of Whitmarsh’s recent claim on the subject of Pay TV that “The sport is going nowhere without the teams.”

However when presented with the figures they may change their minds as the revenues from F1 on Sky are likely to be large. If just 1 million people pay £600 a year to watch F1 on SKY that’s £600 million of gross income. The BBC currently pays around £45 million a year in rights. One would imagine that the deal is likely to be based on the actual take up numbers, so there should be a back end for F1 and the teams get 50% of all revenues.

SKY had F1 a few years ago at the time of the multi channel digital coverage. Ben Edwards, John Watson and Damon Hill were involved. That didn’t do so well because ITV had F1 live and free to air at the same time. This deal is quite different to that.

As I understand it the model in Finland and Japan is slightly different again; there the race is live on pay TV but is also available in its entirety delayed on Free to Air TV.

In Japan the audience for the pay TV show is around 2 million, each paying £12 a month. The terrestrial audience is around 5 million. This is down on the Senna days when around 17 million watched F1 in Japan.

Meanwhile word coming through from SKY is that they plan a full scale production of F1, with no adverts, which they say will take the coverage of F1 “to a new level.”

THe 80 year old said that he has done nothing wrong and will clear his name, as prosecutors in Germany allege that he paid bribes of $44 million (£27 Mill) to Gerhard Gribkowsky, who was once the lead banker responsible for the 2006 sale of the sport to current owners CVC.

Prosecutors further allege that Mr Ecclestone received $41.4m (£25.4m) in commissions from the bank, as well as a large payment to Bambino Holdings, the family trust. The prosecutor has told my colleagues at the Financial Times that Ecclestone “remains under investigation”.

Gribkowsky, who has been in jail in Munich since January, was formally charged with “corruption, embezzlement and tax evasion” yesterday. The prosecutor alleges that his former employer, Bayerische Landesbank, incurred damages of $66 million as a result of Gribkowsky’s actions. The prosecutor said that Gribkowsky sold his bank’s 48% of F1′s commercial rights without an updated valuation in return for payments in the form of “fake consulting contracts”, which were paid into Gribkowsky’s Austrian companies and on which Gribkowsky did not pay tax.

It is not clear at this stage whether Ecclestone will face any charges, but the Daily Telegraph suggested that prosecutors may wait to see the outcome of the Gribkowsky trial and what is said during it, before deciding on further actions. Under German law a court must now decide whether Gribkowsky should face trial, but this appears a formality and it is possible that a trial could take start before the end of this F1 season.

Ecclestone has already been to Munich once, in April, to answer the prosecutor’s questions.

This could all have a very interesting effect on the ongoing discussions with teams and the FIA over the 2013 Concorde Agreement, not to mention the possible sale by CVC of its interests in F1. Although the private equity firm claims that it has no interest in selling, behind the scenes they are believed to be keen to exit, but to get the best price they must wait for the negotiations with teams and the FIA to be concluded and for the situation in Germany to be resolved.

The real value for CVC only comes from Ecclestone remaining at the helm as CEO with all the teams signed up to a new Concorde Agreement and there are some significant challenges there.

Meanwhile the word is that although NewsCorp is going through some significant challenges of its own with the phone hacking scandal in the UK, it remains interested in F1. Time will tell whether any possible changes in management as a result of the scandal change that view.

Through what is likely to be a fascinating period, it’s important to keep in mind Martin Whitmarsh’s recent words, “The teams are working together and this sport isn’t going anywhere without the teams,” he said. “If we stay together, we can control the direction of this sport and we’re not trying to do that for any other reason than what’s in the best interests of the sport.”

* Ecclestone has subsequently admitted that he paid the money to Gribkowsky but said he did so because Gribkowsky was threatening to go to the Inland Revenue in connection with the Ecclestone family trust Bambino. Speaking in the Daily Telegraph he said that the money he received from Bayern LB was a commission on the sale of the stock to CVC, amounting to 5% of the purchase price.

He said that this information is what he gave to the prosecutor on his visit there in April.

We spoke of many things and I put to him some of the questions I’ve heard from fans – not least at the recent FOTA Fans Forum events we organsised – to do with F1′s reluctance to expand into social media and where the balance lies between entertainment and sport.

* Sebastian Vettel’s current domination of F1
* The balance between entertainment and sport
* His sparring match with Jean Todt
* His attitude to F1 content on the internet and mobiles
* The NewsCorp bid for F1
* The succession plan
* Why he thinks F1 doesn’t need a new Concorde Agreement

You can listen to the full interview at the bottom of this post on Soundcloud, with a very interesting exchange about the Senna movie and what it has done for F1. But here are some of the highlights.

Looking ten, fifteen years down the line, Bernie, who do you see running F1? Who would be the right custodians of this sport?”
“It’s something that has to develop on its own. I used to control a lot more than I do at the moment because we’ve let things go a little a bit to other people, we’ve become too democratic. I still think that if I wasn’t around you’d need someone who was going to run things a little bit like I run things.

You mean a ‘Benevolent dictatorship?’
“Yes. That’s what happens with the winning teams. If you run a team like a democracy you’d be in trouble. When Todt was with Ferrari with Michael and Ross, it was like that. Now it’s more Italian and very democratic.”

Do you see your stewardship of F1 as just a chapter in the story of the sport or the whole book?
“It’s one of those things, we’ve grown together.”

In a fragmenting media landscape, can you get more revenue from Social media, internet, mobiles?
“You hear a lot about these things. When we do a deal with a broadcaster we give them the rights to broadcast by whatever method they wish in their country. So if they want to broadcast through a mobile phone – which in effect is a small television, even more so with these pads and what have you – but they don’t seem to want to do it. People still want to turn the TV on.”

Could a new owner of F1 take the content and create more revenue streams on new media?
“I’ve no idea what they would do. Anything that could be done, we’re doing it. We’ve looked into it. All these different methods of broadcasting. The minute we allow other people to broadcast by other means it would upset the people we’ve got (TV) contracts with.”

NewsCorp/Exor came out recently and said they’re interested in buying F1’s commercial rights. Have they been in touch with you about their plans?
“I don’t think they have any plans.”

Are they appropriate people to run F1?
“Most of the people that are involved in F1 think that it would be wrong to have something as strong as the Murdoch group which is very strong, obviously involved, because we built the business up through free to air TV and I think the minute we moved away from that we might find ourselves in trouble. We’d have to wait and see. Also it would be wrong to have Exor, who own Ferrari basically, in there. Because they’d have a big influence over the rules.”

Would NewsCorp’s involvement in the phone hacking scandal in the UK be a problem here?
“Its’ nothing to do with us. They are not hacking our phones! We have nothing they’d want to hack for!”

At the moment we have FOTA but also this new group of four bosses of Mercedes, Ferrari, Red Bull and McLaren, who are having higher level conversations. What’s your read on that?
“I don’t know why they have these meetings. They have a lot of meetings and don’t seem to achieve anything. Those people you mentioned, the bosses, they only got together to see if they don’t want Exor and Murdoch to be involved. They said, “If they are going to get involved, maybe it’s better that we are.” They should approach CVC and see if they can buy the company if they want to.”

What about succession, Bernie? What’s the plan?
“If I’m gone, or rather when I’m gone, somebody will emerge. We’ve got a good enough group around us that would run things without any problems.”

Would I be right in thinking that your chosen successor works in this building? (I have in mind Sasha Woodward Hill, his in house lawyer)
“I wouldn’t choose the successor. (That would be CVC) Yes, or if Murdoch’s bought the company by then they would choose the person who took over from me.”

The Concorde Negotiations are on now, will it be resolved by the deadline, the end of 2012 or is there a danger it might not be?
“The Concorde Agreement is a magic sort of thing. It came about as a sort of peace treaty with the FIA (in the early 1980s). It’s sort of grown and people think it’s a magic document. It isn’t. The important thing in that document is what the teams get paid. All the other things are dealt with by the rules and regulations. So really there is no need to have a Concorde Agreement.”

What about this season? With DRS wings and Pirelli tyres it’s been a season full over overtaking and action, how do you feel about it, can you have too much of a good thing?
“Apart from Sebastian winning everything it’s an incredible season. Having said that people want to know who’s going to beat him. We just had a tennis match and it was magic for people to see Nadal get beaten.

“We’ve got to thank the tyre company for this. When I did the deal with Pirelli I said to them ‘I want you to make a tyre that won’t go the whole distance of the race, I’d like to see one that goes a third of the race. They’ve done a fantastic job, because it’s just as hard for them to do that as it is to make a tyre that will go for ever.”

All sports face the dilemma of where the dividing line is between sport and entertainment. What are your guiding principles when you think about your sport.
“It’s the same for everybody. We need people to not go to an event and known what’s going to happen. When they go to a race they’re talking about all sorts of things, not mechanical things, but about the drivers; who’s going to win and who’s not going to win. That’s why all races that are held in we conditions are that much better.”

The Pirellis are making the racing more exciting, but it’s hurting the qualifying spectacle because the drivers prefer to save a set of tyres rather than go out for another run. Is that a price worth paying?
“Easy to overcome that; another set of tyres.There’s ways we can get around it. I don’t think it’s that big a problem. It puts more pressure on people to deliver if they’ve only got one lap to deliver in.”

All Photos: Darren Heath

You’ve been quite vocal lately about the new generation engines for 2014. Particularly the sound. Why is that such a big thing for you?

“Different engine, we were talking about a straight four, now we are talking about a V6 single turbo. Nobody knows if we are going to get a similar sound that we get from the V8s. I hope that we do.

People love it (the sound) they come to an F1 race and it’s magic. (The high pitched sound?) Yeah. We had the 12 cylinders that sounded fantastic. As long as it’s got a lot of noise. People love to go for the noise.”

You were a keen supporter of Jean Todt for the Ferrari job and for his FIA presidency campaign. But now you seem to be sparring with him, over things like this engine.
“The only argument I have with Jean is what I’ve said. He was right in his thoughts about promoting F1 as a being message about the green environment, which is complete nonsense in my opinion. Because it’s so easy in so many ways. I told him ‘All we need to tell the teams not to have such big motorhomes and then there’d be less trucks bringing all the equipment there and there’d be less fuel used.’ But it’s not the message people want to see. So then I said, ‘Why don’t we reduce the races by 10% if you want to use less fuel?’

“It’s like KERS which was brought in to give a message to people. Problem is we keep it a secret; the only time anyone talks about the KERS system is when it doesn’t work. Nobody ever talks about why it’s there in the first place. So we have to be careful. We don’t want to reduce the appeal to people going to see Formula 1.

“There are so many ways, that we could give a message; there’s the world touring car championship for cars that you see on the road. You can buy them and it is 1.6 litre turbocharged. With Jean at the moment, that’s the only problem I’ve got. We have no problems other than that.”

Viewers in Australia can see some of this interview on Sunday and more on the RPM show next Wednesday.

Bernie Ecclestone interview, July 2011 by James Allen on F1

He builds up to this by saying that,

“I am sure that not so long from now 50 percent of the decision makers in the economy and politics will be women. Women have always had a strong influence, and have probably been in the background for too long.

“I do (think women have a different approach to making decisions) I think that women don’t get trapped so easily in their own ego. Women don’t have to play golf to make deals, they simply have to work harder to get the same acceptance as men. As their egos don’t stand in their way they decide things less emotionally and in the end that serves the cause.”

Photo: Darren Heath

I’ve met her in the F1 paddock, but you’ll struggle to find a picture of her anywhere, she keeps a low profile.

As for timescales, you can take the three to five years reference as you want; Ecclestone is the CEO, there has long been a call for a succession plan and various names have been bandied around. Ecclestone himself is 80 years old and has always said he’ll never retire, but who knows what he is thinking? Anyone who says they know for sure what Bernie thinks is kidding themselves, as anyone close to him will tell you.

Since CVC took 75% of the business, he has done a lot of work securing long term deals on the TV side and on the circuits side as well as increasing the number of official partners like DHL, LG Electronics and UBS.

One other note of interest; Ecclestone says in the same interview that he and FIA president Jean Todt have agreed that if the Bahrain GP is to be rescheduled, they’d like to get the date set before the season starts.

The flamboyant Briatore, who got Ecclestone into football in the first place, stepped down as chairman of the club in February.

“We’re not changing anything, just tidying a few things up,” Ecclestone told Reuters. “We need to be ready in case we get promoted.”

Ecclestone got involved in QPR in 2007 along with Briatore and steel magnate Lakshmi Mittal, who remains a significant shareholder. The club is based in London, near the BBC’s headquarters in Shepherd’s Bush.

It is currently flying high in the English second league known as the Championship, four points clear at the top. There is a very good chance that the club will be promoted to the English Premier League next season, where the real money is. The club has not been in the top flight since 1996.

However to stay in the Premier League requires significant investment in players and if the club plans to stay there long term it will need a larger ground.

Now F1 supremo Bernie Ecclestone, who was close to Benetton’s Flavio Briatore throughout those years, has revived the practice with an ad for the Hublot F1 King Power watch, the first official F1 watch.

It’s an amazing play; Hublot is a premium brand, with watches retailing for tens of thousands of pounds and this advert is going to stop people in their tracks. It’s risky, but totally inspired.

Ecclestone, 80, and his partner Fabiana Flosi were attacked by muggers outside his Princes Gate building in London last week and it was reported that the thieves stole a watch and jewellery worth over £200,000. Ecclestone dimissed these numbers, but in an inspired turn-around he has had himself photographed post-assault with a badly bruised face, saying “See what people will do for a Hublot.”

The ad sums up so much about Ecclestone; his sense of humour, his commercial eye and above all his toughness – can you imagine what a kicking like that would be like at any age, let alone for an 80 year old?

The advert provides its own complex social commentary; what kind of people would do this to an 80 year old man? What does it say about a person’s right to wealth and to have such expensive items on their wrist making them a target.

And it will cause the general public to see Ecclestone in a different light, although the ads are mainly targetted at media outlets catering to high net worth individuals.

One of Toscani's most memorable shock ads

It’s a wide ranging discussion, the occasion being his 80th birthday next Thursday (28th October). It’s quite autobiographical, revealing some interesting details, such as his luck as a child not to be killed when a German warplane crashed near him, blowing him 20 metres, but leaving him unscathed.

Ecclestone: Right time, right place (Darren Heath)

He is a man who gets things done and is frustrated by people who cannot.

Most of us who work in F1 are fascinated by Ecclestone, how he has managed over such a long period of time to build the scale and reach of the sport via TV and via pushing the sport into new territories, the recent Russian and Indian deals being a case in point. People outside the sport are equally fascinated. A banker I spoke to once, while researching an article, said that if he had been born 200 years ago he would have been a Duke.

I hadn’t realised, until I spoke to Renault F1 team owner and internet entrepreneur Gerard Lopez recently, the extent to which Ecclestone is still always listening to and learning new ideas, in this case Lopez’s suggestions about getting F1 onto mobile phones in Africa.

The interviewer positions Ecclestone as the man who created F1. Increasingly Ferrari are positioning themselves as the backbone of the sport, the ones who created the history (along with McLaren and Williams) and have provided the continuity.

The discussion ends with some coded references to the negotiations over the next Concorde Agreement, due to start in 2013, which are now stepping up in seriousness. Speaking about the 12 team principals, who are sitting across the table from him, he says
“They should probably all see that they run their own businesses properly and not worry about others’. What is good for Formula One is good for everybody involved – teams and companies. Too many people only think about what is good for them. It’s the same with the rules – they only think about what can make them win.”

It is going to be very interesting to see how this negotiation goes. The teams want a larger share of the commercial revenues than the 50% they currently receive. In the past Ecclestone and Max Mosley (in his capacity as FIA president) prevailed because they were able to split Ferrari away from the rest and whoever has Ferrari has the sport. Ferrari ended up with a $100 million windfall and a right of veto over rules.

Last summer in the stand off with Mosley over the budget cap, Ferrari invoked this veto and stood firm with FOTA to the bitter end. Will they stay the course this time or jump ship as they did in the negotiations of 2005? Will FOTA stay together or crumble?

That is a question worth potentially hundreds of millions of dollars.

The event was organised by SGX together with sponsorship agency JMI and it was attended by almost 200 delegates.

Ecclestone at the SGX Summit with Oswald Grubel of UBS bank

It was widely agreed that Singapore has performed miracles to establish itself as one of the most important events on the F1 calendar, equal with Monaco. This is the race that most CEOs from companies involved in the sport come to. Certainly for European execs, being seen to lord it up on boats in Monaco is now verboten within their companies, whereas Singapore is seen as a “must do”.

“People used to say, ‘Go west, young man,’ but now the world is moving east,” Ecclestone said. “Formula 1 has gone worldwide and we have opened a lot of people’s eyes to the sport, but it has taken us a long time to achieve that.”

For an increasing number of sponsors, the sport’s growing profile in Asia is a key reason to enter, certainly that was the case for UBS, which makes is debut this weekend on signage around the track.

From the Singapore side, the arrival of the F1 race here, now in its third season, has galvanised the business community, as the Minister of Trade Mr Iswaran observed,
“The impact of F1 is far reaching and can be felt beyond the tourism landscape,” he said. “It has galvanized companies and community groups to ride on its momentum and organize events around the F1 race to involve the community and businesses at large.”

One of the most impressive presentations was from the boss of the Singapore Sports Council, who showed how the country is backing up its flagship Grand Prix by investing in grass roots motorsport programmes. It’s quite clear that Singapore has a well thought out strategy based around the GP and it isn’t a white elephant. It’s been such a success already it’s hard to imagine where this GP will be in 10 years time. And by then the benefits of its grass roots programmes will have kicked in.

Almost a third of the races on the current F1 calendar take place in Asia, and next year the addition of India will continue that trend. Several of the speakers observed that as roughly a third of the global economy is in this region that balance is appropriate.

Naturally this comes at the cost of European races and striking the balance between races on classic circuits in Europe and ones which struggle to find a following is something F1 needs to achieve as it balances heritage with expansion.

But clearly not all races in this region are as successful as Singapore. Malaysia doesn’t do all that well in terms of ticket sales and certainly all the corporates now shun it in favour of Singapore. Likewise Japan. The race in Korea next month already looks something of a concern.

Fernandes and his Team Lotus are working hard to help the grass roots in his native Malaysia, so time will tell if the sport takes root there.

There is optimism about the race in India, however. A sports mad nation with its own F1 team – and potentially driver – it’s also a key market for many of the companies involved in F1. If they learn from the way Singapore has gone about things, then it should work out fine.

Saab is currently owned by General Motors and is loss making.

Ironically for a man who is suspicious of the internet, Ecclestone’s bid is based on the latest thing in automotive innovation – internet in cars.

On its website this afternoon, Genii Capital said that it had been brought into the bidding process at a late stage by advisors close to the deal. It says it will “aggressively work towards a successful closing of the transaction.”

The consortium’s strategy is to add value to Saab by working with areas of overlap with its own business, particularly in the emerging field of internet in cars, which has been a talking point of the Consumer Electronics Show in Las Vegas this week.

Genii is very interested in VOIP and GPS systems in cars as well as on demand systems. They believe that Saab has very strong brand values already and an innovative image. And by putting Saab at the cutting edge of these new technologies they can make the company’s cars very attractive to younger, well heeled, tech savvy buyers, particularly if they are first to market with these new technologies.

There is inevitably speculation that this might bring Saab into F1, but I’m not sure that is the strategy here, at least in the short term. Lopez sees an opportunity for his new technologies in the automotive sector.

His team will be called Renault for at least the next two years, as part of its commitment to the Concorde Agreement. After that, if the French manufacturer, which retains a 25% stake in the team and is still the engine builder, were to exit, Lopez may well wish to introduce the Saab brand to his team, as there are few better platforms for promotion than F1. But at that stage other rival competitors might question Ecclestone’s involvement, if it were to continue.

Incidentally, I hear that there are likely to be many personnel changes at Renault’s Enstone base over the coming year or so.

The third member of the Saab consortium, Lars Carlstrom, told Dow Jones today that talks with General Motors were going well and that a bidder should have some EUR800 million available. He did not comment on how much his consortium would be prepared to pay for the car maker. But there believed to be the possibility of a European Investment Bank loan of around €400 million.

“Saab will be able to supply over 100 000 cars in a few years, this is by no means impossible, ” said Carlstrom. This is the kind of number it used to sell. Projections for 2010 are around 50,000 cars.

Carlstrom was previously trying to buy Saab with two investors who are now against him in the bidding process. A third bidder is Spyker, which made a disappointing cameo in F1 recently when it acquired the former Jordan team from Midland. It sold on to Vijay Mallya, who renamed the team Force India.

Ecclestone is a member of the WMSC himself and has a personal interest because Briatore is a close friend and business associate with whom Ecclestone spends his evenings at race meetings. Now, it seems their relationship is broken. Speaking at an LG press conference in Singapore today he said,
“He’s not talking to me, I don’t know. He thinks I should have defended him, which I couldn’t.”

But beyond that, reading between the lines of what he is saying here, it seems to me that he is laying the ground for an appeal by Briatore, from which he feels the Italian might emerge with a lesser sentence.

It’s just a hunch, but the wording looks quite significant to me. Max Mosley suggested the same thing yesterday, but Bernie’s message looks like some kind of signal. It’s curious. I’m hearing from my French colleagues that Briatore, having initially indicated that he wishes to pursue this in a civil court, is now coming around to the idea of an FIA appeal, having previously not wanted to have anything to do with the FIA.

“If you look at it sensibly, the people at the top had not the slightest idea,” said Ecclestone. “The people in the Renault F1 team had not the slightest idea.

“There were three people who knew what was going on and that is it. No one else was involved. Those people have been dealt with – in my view quite harshly in [regards to] Flavio. I don’t think it was necessary, but I was on the commission so I am probably just as guilty as anyone else. On reflection it wasn’t necessary. It was too much. Definitely too much.

“He should ask to be heard by the (FIA) court of appeal. If he goes to a civil court I don’t think he would win. Because the FIA would have to defend and somebody will say that he sent a young guy out to what could have been to his death. So it wouldn’t go down too well.”

Mind you, even if his sentence was cut to the level of Symonds’ that would still be a ban of five years and it seems unlikely that at the age of 64 Briatore would want to come back to racing.

There are suggestions that Briatore has been thinking of starting his own rival series to Formula 1, or trying to persuade the FOTA teams to follow though with the breakaway threat. But it’s hard to imagine.